DoD News

News Article

Deployed Troops Get Break on School Loans

By K.L. VantranAmerican Forces Press Service

WASHINGTON, Sept. 4, 2003  Military personnel who have been deployed or mobilized are not required to make student loan payments during their absences.

Federal regulations require lenders to postpone the student loan program payments of active duty military personnel. This applies to members of the National Guard and Ready Reserves who have been called to active duty, as well as to active duty personnel whose duty station has been changed as a result of a military mobilization.

"Many of the brave men and women serving our nation right now have put their personal lives on hold to answer the nation's call to duty," said U.S. Education Secretary Rod Paige in a news release earlier this year. "As they defend the freedoms we cherish, our soldiers should not have to worry about their student loan obligations and resuming their studies."

He encouraged the higher education and lending communities to be flexible and provide assistance to service members, so they can "easily resume their studies and financial obligations after they complete their tours of duty."

The regulations apply to student loans made under the Federal Family Education Loan, William D. Ford Federal Direct Loan and Federal Perkins Loan programs.

The law also requires that active duty military people who have not begun the repayment period on their loans continue to receive a grace period (generally six months) before repaying their loans. Students who were in school at the time of mobilization must also be given a reasonable period to resume school before lenders request payments.

Colleges will not be required to collect financial aid funds that now-active duty students were given to pay for books and living expenses. Additionally, Education Department officials encourage colleges and universities to either fully refund tuition and other institutional charges or give comparable credit against future charges to students forced to withdraw from school to fulfill their military obligations.